Keller Williams Realty, LLC has agreed to pay $20 million to settle a class-action lawsuit brought by homebuyers alleging a decades-long conspiracy to fix real estate broker commissions and inflate home prices, according to court documents filed Feb. 2 in the U.S. District Court for the Northern District of Illinois.
The settlement provides monetary compensation to potentially millions of homebuyers who purchased homes listed on an MLS during the class period.
Beyond the cash payment, Keller Williams has agreed to provide cooperation in the form of deposition testimony, trial testimony and documents as litigation continues against remaining defendants including the National Association of Realtors® (NAR), Anywhere Real Estate and REMAX.
“We are the first defendant to resolve this litigation with the goal of eliminating uncertainty for our franchisees and agents,” Keller Williams CEO Chris Czarnecki told agents in an email. “We came to the decision to settle with careful consideration for the immediate and long-term well-being of our franchisees and agents, and the business model they depend on.”
Darryl Frost, a spokesperson for Keller Williams, said the company is “pleased to reach a nationwide settlement, releasing the company—and all of our franchisees and affiliated agents and teams—from antitrust litigation brought by homebuyers who purchased residential real estate that was listed on a MLS during the relevant time period.”
A spokesperson for (NAR) said that this development does not directly affect NAR’s position in the Batton litigation.
“We respect Keller Williams’ right to settle these claims and anticipated the possibility they would do so. NAR remains actively engaged in the Batton joint defense group, and we continue to defend our rules where questioned,” the spokesperson added. “Given recent history and the dynamics of this case, NAR continues to pursue all potential resolutions, both non-litigation and litigation, to reach a result that is in the best interest of our members, the industry and consumers.”
Five years of legal battle
The settlement comes after five years of litigation involving multiple motions to dismiss, extensive discovery exceeding half a million documents and months of mediation. Eight plaintiffs alleged that defendants conspired to enforce anticompetitive rules that inflated buyer broker commissions, which in turn artificially increased home prices.
The $20 million settlement fund will be distributed pro rata to class members who file approved claims with shares calculated using a formula developed by plaintiffs’ experts to estimate the overcharge each homebuyer experienced.
If the court grants final approval, settlement class members will be notified through direct email and digital media campaigns like Facebook, YouTube and Instagram.
Editor’s Note: This story was updated to include NAR’s statement.
